Sometimes things are not what they seem. For example, the starting purpose of the United Nations was to win World War II. The term "United Nations" was coined by President Franklin D. Roosevelt, who first used it at the beginning of WWII, when representatives of 26 nations pledged to fight together against the Axis Powers. The peacekeeping only came about later – toward the end of the war.

Thus, our institution of peace got its start as a win-a-war exercise. Life is often counterintuitive. Humans want stability, but things don't often go the way we feel they should.

Remember when late December seemed like we were headed straight into a bear market? Growth was over. Markets were "still overpriced" in some pundits' views as they hit fresh lows. I heard, "This time it's different." The mood was dour – the situation dire. Many concluded that the bull had finally died.

But many also fell for the market playing dead – it just perked up and said, "Just kidding!" Then it got up out of the gutter and scampered away as fast as it could. By now, you've seen me publish this table for months. But that right-most column is the frisky, troublemaking market. It's saying, "I have somewhere I have to be, and it's not down!"

Performance of the major indexes over the past week and since Dec. 24 lows

I know it's boring by now, but it's all growth! That's right – growth is back, and it's king – and this was the poison pill that was supposed to undo global stocks late summer of 2018. For those who got spooked and puked stocks, it proved a costly mistake.

The S&P 500 Growth index is the biggest S&P performer since Christmas lows. The NASDAQ Composite is the biggest broad index performer in the same time. The Russell Growth indexes are whooping Russell Value. Info tech, discretionary and industrials are the leading sector indexes. Utilities, health and staples lag notably. Finally comes the powerhouse PHLX Semiconductor Index, up almost 6% for the week and up a massive 38% since Christmas.

This should leave no doubt as to what is pushing this market higher: growth. Let's review. First, remember that the MAP Ratio we calculate every day measures unusual buying versus selling on a 25-day moving average, meaning that we tally up unusual buys and sells and make a daily ratio, then take the five-week average. That allows my team to identify overbought and oversold points. These can be extremely powerful, as was evidenced by the oversold call on Dec. 24. Our ratio flashed oversold and within a few days began a rally for the ages!

So, when the MAP ratio went oversold in December, that was the "everyone in the boat" signal. The rally started, and the ratio screamed higher. When we went overbought Feb. 6, I said it could stay that way for a while – it did. That ratio peaked on March 1 and fell steadily since. The market exited overbought levels on March 27 and is currently in neutral territory. See the table below:

MAP Ratio of unusual institutional (UI) buy signals to sell signals

The following chart shows the MAP Ratio against the performance of the Russell 2000 index.

Performance of the Russell 2000 vs. the MAP Ratio

So, what does that mean? Well, right now we are still seeing outsized buying. The buying outnumbers sells significantly, but not enough to be unsustainable. That's good, because it means we are in a healthy zone for a continued bull. When the ratio is in the 60s or 70s, it's a healthy and sustainable ratio of buying to selling. And think about it – if there is 60% to 70% buying versus selling, it stands to reason that market prices will trend upward. And that is precisely what we are seeing.

Remember all that exchange-traded fund (ETF) selling I used to talk about? The market got spooked plain and simple in late 2018. The jitters caused a technical collapse and forced ETF selling, which peaked at the market trough.

Performance of Russell 2000 Index vs. ETF buy and sell signals

If you look at the green bars to the right of the above chart, you'll notice something. We are now beginning to see ETF buying return, with little hint of selling. This means that the massive capital outflows out of ETFs preceded a new rush of capital into ETFs. The buying is nowhere near as intense as the selling, which possibly indicates that there's plenty more buying to come. We believe all that ETF selling caused the intense stock selling at the same time.

Performance of Russell 2000 Index vs. stock buy and sell signals

On Friday, we noticed that 17% of our tech universe was being bought – a chunky number. Cryptocurrency, China and global stocks are rallying, setting up for a nice continued rally. Prior pain points are leading us higher.

The U.N. was a fighter before it was a lover. The market low was the signal for the new legs of the bull. Before you decide how things are, think of Tommy Cooper. He said, "I used to think I was indecisive, but now I'm not so sure."

The Bottom Line

We (Mapsignals) continue to be bullish on U.S. equities in the long term, and we see any pullback as a buying opportunity. Buying has started to pick up compared to the week prior, suggesting that the near-term trend is bullish.

Disclosure: The author holds no positions in any stocks mentioned at the time of publication.